If the federal government is to revisit the superannuation objective bill introduced into parliament in 2016, it needs to incorporate an aspirational element into the defined purpose of the retirement savings system, a technical services manager has said.
According to SuperConcepts technical services and education general manager Peter Burgess, the industry thought the proposed definition of the objective of super in the original bill, that being to provide income in retirement to substitute or supplement the age pension, set the bar too low.
“The superannuation industry said we need to have a more aspirational target and the wording is very important. Each word means something in that primary objective because the government is very much aware whatever primary objective we settle on will determine the amount of tax concessions that will need to be directed toward super to achieve it,” Burgess told delegates at the SMSF Professionals Day 2019, co-hosted by selfmanagedsuper and SuperConcepts, in Sydney last week.
He added the degree of aspirational element in the objective will be directly proportionate to the tax concessions the government will need to provide to allow superannuants to meet the stated objective.
The reintroduction and passing of this legislation, which lapsed before the May federal election, is important as it has the ability to prevent the constant changes to the retirement savings system included in each year’s budget, he stressed.
To this end, he noted the legislation needs to also include a mechanism compelling policymakers to refer to the objective before they make any system changes.
“That wasn’t entirely clear in the bill that was introduced back in 2016,” he said.
In early July, SuperConcepts launched a campaign to encourage the government to enshrine the objective of super in law now the election is out of the way.